The following information is given about stock G and the market: Risk free rate is...
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The following information is given about stock G and the market: Risk free rate is 9% Expected rate of return on an average stock is 13% Beta coefficient for stock G is 0.4 Current Price of stock G is $30.00 Growth rate is 5% Next expected dividend is $1.75 Required: a) Is the stock price in equilibrium? Explain. (Show all calculations to support your answer). b) Considering your answer to part a), What will investors do? What will occur in the market
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